TLDR:
- Venture capitalism shifted power to the financial sector post-1970s crisis.
- The “shareholder revolution” changed the focus of corporations to maximizing shareholder value.
Venture capitalism, as described by Benjamin Shestakofsky, is a result of structural changes that transferred power to the financial sector following the crisis of the 1970s. Corporations began prioritizing shareholder value over other stakeholders, leading to a focus on increasing stock prices and returns for investors. This shift, known as the “shareholder revolution,” fundamentally changed the way corporations operated.
Executives were now pressured to make decisions that prioritized investors’ interests, leading to increased financial activities like stock buybacks and dividend payments. This shift towards financialization in corporations also led to a rise in income inequality, as workers saw stagnant wages while executives and investors reaped the benefits.
In venture-backed startups, workers are often given stock options as part of their compensation, tying their fortunes to the success of the company. However, these workers face precarious job security and long hours, with their income tied to the success of a single company or industry.
Overall, the rise of venture capitalism has transformed workplaces and workers’ subjectivities, emphasizing the importance of organizational flexibility and financial motives over other considerations.
